Sir Richard Branson and Sara Blakely on Britain’s new breed of entrepreneurs

7 September 2016
| Author: Joanne Frearson

Sir Richard Branson, founder of Virgin Group, is sipping a cup of tea in the make-up room at ITV Studios, relaxing before the final of Virgin’s Voom entrepreneur competition with Sara Blakely, founder of underwear firm Spanx, who is a judge at the event. The pair go back a long way – ever since Blakely appeared on Sir Richard’s reality TV show The Rebel Billionaire in 2004, the pair have been firm friends.

The pair come across as charming and witty as I talk to them. “Optimists do a lot better than pessimists in business,” Sir Richard tells me. “Obviously, you need to protect against the downside all the time and look at the worst thing that can happen, and how you can avoid that happening. But being an optimist is so much more fun – and you then make your optimism happen.”

The optimistic way of thinking certainly seems to have proved successful for the pair in their respective ventures. Both having built billion-dollar businesses from scratch, they are two of the most famous names in business.

“You have to work day and night – you have got to put everything into it. In the early days it is like climbing a high wall,” Sir Richard says. “There is a very thin dividing line between success and failure and you have to fight extremely hard to start on the right side of that dividing line.

“It takes quite a long time to get to the top of the wall and then start to come down the other side and feel that your businesses are secure.”

My meeting with Branson and Blakely comes just after Britain’s vote to leave the EU, and Sir Richard – a prominent campaigner on the Remain side – makes no bones about voicing his unhappiness with the outcome of the referendum.

When I ask him about challenges in businesses, he pointedly replies: “politicians.” Of the referendum result, he says: “It is the biggest blow that has happened to business that I know potentially in my lifetime. It is going to be worse than the 2007 crash – the banks have been pulverised, and it is going to be really difficult for young people to get money from the banking system. It is likely we are heading into recession.”

In the aftermath of the Brexit vote, some bank stocks went down as much as 50 per cent. Although most bank stocks have recovered from the lows of the immediate shock of the vote, this does not necessarily mean it is plain sailing ahead for the British economy, and measures have been taken by the Bank of England to help provide additional support to the UK. The BoE has cut interest rates to 0.25 per cent from 0.5 per cent and introduced other monetary stimulus measures to help sustain growth and employment. On its website, it states: “If we hadn’t acted quickly these uncertainties would have meant lower economic activity and more people out of work.”

Branson (who we spoke to before the BoE’s measures were put in place) predicts that the coming business environment will be challenging to say the least. “Young entrepreneurs are going to have to deal with it – they are on the verge of having a £500million market taken away from them,” he tells me. “They are going to have to come up with imaginative ways of overcoming all the hurdles that have just been put in front of them. Where there is a will there is a way. Obviously some are going to be completely destroyed, and others will overcome.”

“It is going to be devastating to employment in Britain. It is going to be devastating to wages. It is going to be devastating to business. It is going to be devastating to infrastructure. In business, if we suddenly realise we have made a dreadful mistake, we will change tack. For the sake of the country, people have to be brave and change tack.

Sir Richard believes the result of the referendum will further stifle the already sluggish flow of cash in the UK, and if people can get access to money to start their business, it will help compensate for the hurdles Brexit will give them. He is certainly an authority when it comes to dealing with harsh economic conditions – when he first started out interest rates were 18 per cent.

Blakely is similarly motivated when it comes to dealing with challenges. She started underwear company Spanx right before 9/11, and initially found it hard to get people to buy her underwear. To get a buyer interested in her product, she had to go into the toilet and show them the before and after effect of her underwear.

Blakely says it is important to not see everything as a challenge but as an opportunity.

“There is a mindset that happens when you are in business that is really important,” she says. “Each challenge that comes along you try to outsmart, or you find the people that can help you manoeuvre around those challenges.

“I stayed so closely connected to the consumer and what the consumer wanted and the products I could deliver to them, that the path sort of took care of itself.” Indeed, Blakely’s line of undergarments is so popular that talk show host Oprah Winfrey has them on her ‘Favourite Things’ list. “I’m always asking my team, will I get arrested?” she laughs.

“I nearly called my first autobiography – instead of Losing My Virginity – Talking Ahead Of Yourself,” offers an amused Sir Richard. “You have somehow got to motivate everyone – talk ahead of yourself, then try to catch up with what you have been saying.”

That, in effect, is why Sir Richard and Blakely are in London at the moment, to inspire and select Britain’s next best entrepreneurs at the final of Voom. “When I started, I did not have anyone to hold my hand,” Sir Richard says. “It gives young people who are starting businesses a much better chance if they have a really good mentor and also a leg up financially.

“Voom has just got stronger and stronger over the last five years. We also have something called Virgin Start-up Loans, which gives money and creates apprenticeships on the back of Voom. We want to try and help thousands of young people to get their businesses going.”

Voom started about five years ago, set up by Virgin Media Business to help give start-ups a chance to pitch their business ideas to Branson and receive valuable financial support as well as mentoring and PR.

What Branson and Blakely have both been particularly impressed with at the Voom final are entrepreneurs who have ideas which have a social conscience. The two big winners for Voom 2016 were MacRebur, which uses recycled material such as plastic to produce asphalt for roads, and bio-bean, which turns waste coffee grounds into sustainable biofuels.

Sir Richard believes that successful businesses boil down to those that come up with an idea that is going to improve other people’s lives. “My motto in life is, screw it – just get on and do it,” he says. “Then you have a business.” And at a time of economic uncertainty, such boldness is perhaps just the tonic the business community needs.